Siti Afiqah A. Halim, Farah Aida Ahmad Nadzri, Farah Aida Ahmad Nadzri
Financial fraud can be broadly defined as an intentional act of deception involving financial transactions for purpose of personal gain. Many fraud cases involve complicated financial transactions included the Ponzi scheme which is conducted by 'white-collar criminals' such as business professionals with specialized knowledge and criminal intent. In the 1920s, Charles Ponzi engaged with the Ponzi scheme which also known as money flows from the bottom up. The continuous issues of the Ponzi scheme in Malaysia, especially the involvement of students as victims has become the major problem to look forward to the factors that influence university students to this investment fraud. This paper explores the gullibility factors of individuals' extent of exposure to a Ponzi scheme among Bumiputera university students in Malaysia. This study conducts face-to-face interviews and observations with Bumiputera university students in Malaysia through purposive sampling. Findings show that the victims involved in the Ponzi scheme are gullible, meaning that their level of trustworthiness is high, based on the four elements of Gullibility theory (situation, cognition, personality, and state). This study will benefit the regulators, enforcement agencies, and universities to further understand the reasons why the students are involved in Ponzi schemes. It also benefits the body of knowledge about the characteristics of Ponzi scheme companies that are considered people of choice. Future researchers should investigate the methods to minimize future investors' participation, especially the students and losses in fraudulent investments.